Indiana § 27-1-12.1-7 Requirements for assumption of risk

Indiana Statutes

§ 27-1-12.1-7 — Requirements for assumption of risk

Indiana § 27-1-12.1-7

Title 27INSURANCE

Art. 1DEPARTMENT OF INSURANCE

Ch. 12.1Limited Purpose Subsidiary Life Insurance

This text of Indiana § 27-1-12.1-7 (Requirements for assumption of risk) is published on Counsel Stack Legal Research, covering Indiana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook

Ind. Code § 27-1-12.1-7 (2026).

Text

Before assuming risk under a reinsurance contract, a limited purpose subsidiary must do all of the following:

(1)Comply with IC 27-1-6.

(2)File with the commissioner an affidavit, signed by the limited purpose subsidiary's president, vice president, treasurer, or chief financial officer, including all of the following to the best of the individual's knowledge after reasonable inquiry:

(A)That the proposed organization and operation of the limited purpose subsidiary complies with this chapter.

(B)That the limited purpose subsidiary's investment policy reflects and considers the liquidity of assets and the reasonable preservation, administration, and management of the assets with respect to the risks associated with reinsurance contracts issued by the limited purpose subsidiary.

(C)That

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Before assuming risk under a reinsurance
contract, a limited purpose subsidiary must do all of the following:
(1) Comply with IC 27-1-6.
(2) File with the commissioner an affidavit, signed by the limited
purpose subsidiary's president, vice president, treasurer, or chief
financial officer, including all of the following to the best of the
individual's knowledge after reasonable inquiry:
(A) That the proposed organization and operation of the limited
purpose subsidiary complies with this chapter.
(B) That the limited purpose subsidiary's investment policy
reflects and considers the liquidity of assets and the reasonable
preservation, administration, and management of the assets
with respect to the risks associated with reinsurance contracts
issued by the limited purpose subsidiary.
(C) That the reinsurance contract and any arrangement intended
to secure the limited purpose subsidiary's obligations under the
reinsurance contract (including an agreement to implement the
arrangement) comply with this chapter.
(3) File with the commissioner the opinion of a qualified actuary
that the methodology and assumptions (including significant
stress tests of key assumptions) used to establish reserves held by
the limited purpose subsidiary are sufficient to provide for the risk
assumed by the limited purpose subsidiary.
(4) File with the commissioner the limited purpose subsidiary's
plan of operation, including the following:
(A) A statement that the limited purpose subsidiary will, before
an offer and sale of securities of or by the limited purpose
subsidiary, file with the commissioner, in a form acceptable to
the commissioner, a legal opinion that the offering and sale of
securities:
(i) of the limited purpose subsidiary complies with all federal
securities laws; and
(ii) by the limited purpose subsidiary complies with all
Indiana securities laws.
For purposes of this clause, the issuance of stock by the limited
purpose subsidiary to the organizing domestic life insurance
company is not the offer and sale of securities requiring a legal
opinion.
(B) A complete description of the material terms of all
proposed reinsurance transactions, reinsurance security
arrangements, securitizations, and any other material
transactions or arrangements of the limited purpose subsidiary.
(C) A description of the source and form of the limited purpose
subsidiary's capital and surplus.
(D) The investment policy of the limited purpose subsidiary.
(E) Pro forma balance sheets and income statements that
illustrate at least one (1) adverse case scenario, as determined
using criteria required by the commissioner, for the
performance of the limited purpose subsidiary under all
reinsurance contracts.
(F) Policies for payment of dividends and other distributions to
the organizing domestic life insurance company.
(G) Copies of all contracts between the limited purpose
subsidiary and affiliates.
(H) Other documentation or information required by the
commissioner.
(5) Obtain from the commissioner a certificate of authority to
engage in the business of reinsurance in Indiana.